Appraisals are important because they protect not only the seller and buyer but also the lender. The lender wants to make sure they know what the property is worth. Therefore, an appraisal is more about valuing the property and not about the price of the home.
Oregon is home to a tough breed of freethinkers who like to be prepared. No one likes a shock, especially when it’s tied to your wallet. Wherever you are from, the unexpected costs of buying and owning are a reality.
First-time buyers get hit with sticker shock up front. It’s not just the price of the home. Though things like “closing costs” aren’t unexpected, sometimes the price, and just what closing costs have come as a surprise. Long term homeowners are not immune to the unexpected costs of owning a home in Oregon. Roof and window repair or replacement can carry a hefty price tag, not to mention other costs of maintenance and upkeep.
According to the Holmes and Rahe Stress Scale, closing on a home, maintaining a mortgage, and moving are some of the most stressful things that occur in a person’s life. Taking this all into consideration, we thought it would be worthwhile to take a few minutes and share some of the unexpected costs of buying/owning a home in Oregon.
Closing costs are the extra expenses buyers and sellers have to pay in addition to the purchase price at the closing of any real estate transaction. Closing costs can range between 2 and 5% of the loan amount and generally include things like;
- Origination Fees
- Appraisal Fee
- Credit Report
- Home Inspection
- Closing Fee /Escrow Fee
- Escrow property taxes and Homeowner’s Insurance
- Title Insurance
- Discount Points
- Recording Fees
- Transfer Fees
Doing your due diligence and comparing different mortgage companies can help minimize these expenses as you will see variances of thousands of dollars between companies offering the same product at the same rate. Look for mortgage lenders in Oregon that are transparent with what they have to offer in order to avoid a bait and switch where a lender will offer a lower rate and fee when you don’t have a property under contract only to increase the rates or fees when your actually in a position to lock a rate. If they don’t show what they have to offer you have to wonder what they’re hiding.
For a more detailed look at closing costs and connect with a mortgage professional at Sammamish.
You did it! You finally got through the closing, congratulations you are a homeowner. Don’t put your wallet away. After spending more money in one sitting than you probably ever have before, it’s time to go back to the ATM. The cost of moving can be a huge expense.
Things always seem to add up here, even if all you do is rent a truck, ask a few friends to help, and supply them with beer and pizza. Some things you may want to plan for are:
- Packing Materials – Padding, bubble wrap, tape, boxes a few Sharpies, and Ziplock bags for screws.
- Hand trucks “dolly”
- Truck Rental
Professional movers can be very expensive but they are professionals for a reason. Unexpected injuries due to lifting heavy items can cost money and time. If you can afford it, It’s nice to be able to focus on packing and organization without having to do as much heavy lifting. Just in case you are worried about trusting your heirlooms to a mover it’s a good idea to make sure the mover you higher is insured against any unforeseen “accidents.”.
Make it your space
When you were looking for a place to buy, much of your time was spent asking questions about things like closet space, bathrooms, kitchen storage, and usability. Now that the home is yours, It’s time to start “feathering your nest.” Everyone does it. In fact, it’s as natural as can be. Decor items, both functional and aesthetic find their way into your new space giving each room your personal flair.
Safety & Security
Speaking of personal space, many folks may want to upgrade the security of their new home. From changing the locks and installing a few more lights around the exterior to hiring a professional security company to install and monitor an alarm system. Safety and Security are definitely one of the big unexpected costs of buying a home in Oregon. Start budgeting now, so you can afford the security you want.
More light, please! Another unexpected cost of homeownership comes naturally right after security. Many times it feels like the house was much brighter when you viewed before making a purchase. As you make the home your own, you will solve lighting and electrical issues in a variety of ways. Many times, issues of low light can be solved fairly simply with a lamp, but you may need to get more involved. Installing new lighting fixtures and outlets can add up quickly.
Deck repairs or ads, Patios, and sheds
This one always seems like a one-off; you may remember yourself thinking, “oh I can fix or change that later” Most people fall in love with kitchens and bathrooms, then the rest of the house kind of follows. So, it’s no surprise that things like deck and porch repair or replacement often get overlooked and put into the “we can fix that” category. Just remember “fixing” means more money
Many people are shocked to find out that landscaping costs money, even when you do it yourself. If you are moving from an apartment or rental where the landscaping was taken care of by the landlord you may need a mower and a trimmer to start things off. Planning to hire a professional service to take care of the landscaping? During the summer months, lawn service can be expensive. It’s not out of the ordinary to pay several hundred dollars a month or more, and generally, that only covers cutting and trimming the grass. If you want more done with the landscaping expect to pay even more.
Home Maintenance, Cleaning, and Repair.
This one affects first time buyers and long term homeowners alike. The first items on this list are all the little things you didn’t notice in the home inspection but need now in order to start your home maintenance on the right foot. Things like lightbulbs, batteries for the smoke detectors, extension cords, garage door openers, garden hoses, door-mats, furnace, refrigerator, and water filters. don’t forget cleaning supplies. One of the big keys to proper home maintenance is just keeping things clean and all the little items like mops, scrub brushes, and cleaning chemicals start to add up.
Consider long term maintenance as well. Most experts agree you should budget around 1-2% of the value of your home per year towards maintenance and upkeep. It may seem like a lot but when you suddenly need to fix or replace your roof, windows, or a major home appliance, you will be grateful you set the money aside.
How long do things last? Consider a home warranty.
After reviewing some of the unexpected maintenance items, here’s what the National Association of Home Builders has to say about the estimated lifespan of maintenance items:
- Roofs typically last 20 to 30 years, but that depends on the material. Most roofing shingles carry a 25-year warranty. However, clay, concrete, slate, or copper roofs can last long as 50 years or more.
- When it comes to flooring, carpets usually last up to 10 years. You should get closer to 25 years for linoleum and 50 for vinyl. Wood, marble, slate, and granite floors have a much longer life expectancy and can last for 100 years or more in some cases.
- Decks last about 20 years if they are “well maintained.” This means regular cleaning, staining, and repairing any rotting or damaged wood throughout the lifetime of the deck. Living in Oregon, you can expect a shorter lifespan and more maintenance because of the extra moisture.
- Home mechanicals? Gas Furnaces usually last up to 18 years and electric 15. The central air conditioner in your home is usually good for about 15 years.
- Appliances typically last somewhere between 5 years and 15 years. This includes the washer and dryer, refrigerator, and gas range.
When you think about all of those big-ticket items, not only does it make sense to start saving for home maintenance and repair, but you may want to consider purchasing a home warranty. When you consider the alternative, a good home warranty can save a lot of financial frustration.
Picture yourself in your perfect little Portland bungalow. You just moved in a few months ago and you step down into your basement one morning only to find yourself ankle-deep in water. A pipe has burst and flooded your basement. Lots of cleanup and $1000 dollars later, you find yourself wondering how you will make next month’s mortgage payment. Don’t get stuck wondering how you will make the ends meet. Instead, start budgeting for the unexpected costs of owning a home before you purchase so you can make your dream house a home and keep it that way.
Whether you are looking to buy, refinance, or just have questions about homeownership, be sure to consult with your trusted home mortgage professional to discuss current options. Don’t wait, contact the experts at Sammamish Mortgage today with questions about refinancing or securing a mortgage. Let the mortgage professionals at Sammamish Mortgage guide you. Family owned and operated for more than 25 years, we know what you value. Let us help you understand the ins and outs of home financing and more. Sammamish Mortgage offers a variety of loan programs including FHA and VA mortgages. Regardless of your situation, we can guide you through the process. Proudly serving Portland, Salem, Eugene, and the state of Oregon, Washington State, Idaho, and Colorado. Please contact one of our friendly staff members today. We look forward to serving you.